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you pay what was agreed on. After your down payment and the escrow has started they do not have the right to come back and say they want more from you. If you are the seller you should have not accepted the offer you accepted and you could have waited for more money... Dont be so stupid sounding... YOU KNOW THE PRICE YOU SOLD IT AT OR IT WOULD NOT BE IN ESCROW...

When a mortgage appraisal comes back and it is so low that the buyer can not get their loan- for instance on FHA it needs to come back at or above the sale price- the seller needs to agree to sell at the lower value or the buyer needs to agree to come up with additional money for a bigger down payment. Or the transaction can terminate. There is no hard and fast deadline. Your agent goes to bat for you and buyer agent goes to bat for buyer. Perhaps each one adjusts a little.
On a conventional loan the appraisal comin in a little low may not matter at all.

If the house appraise for less than the contract price agreed upon, the sale of house would also drop to the appraised value of the house.

Normally your sale contract would address this situation. The appraised value of the house would become the sale price.

The mortgage lender would still approve the loan and provide the same percentage of the appraised value of the house. If this percentage is 80% they would still provide the 80% The buyer would provide the other 20%.

The buyers would not make a good financial decision if they would agree to purchase the house below the appraised value. The would have minus $10K of equity in the house and they have not moved in to the house. Why would the buyers agree to this?

If you are not willing to drop the sale price to match the appraised value of the house, your sale transaction might have come to an end.

This is a situation that your real estate agent and the real estate agent of the buyer would have to get together and solve this. As a buyer agent, my recommendation to my client would do not go through with the sale transaction unless the seller agree to drop the sale price to the appraised value of the house.

This is a question for YOUR agent, who should be in touch with the buyer through the agent they used. It's a matter of if the lender will still approve the mortgage the buyer applied for. If the lender will not, the buyer can get out of the contract through the mortgage contingency clause. If I was working with the buyer, I would be in immediate contact with your agent. Where IS your agent?

That depends on what your contract says. If the agent of the buyer was sharp, he may have included a contingency that the appraisal must be equal to or greater than the selling price. If that contingency is in there, the buyer can simply walk, if he desires. If no such contingency is in the offer, then you have a binding contract, regardless of what the appraisal came in at. In do not know to whom you "appealed" the appraisal, but that will not work. The lender chooses the appraiser and they do not second guess the appraiser chosen.

No one has yet answered your question.
Your buyer has until the contracted closing date (plus a cure period) to decide to purchase your property or to invoke the contract's financing contingency.
To increase the odds of the sale going through, you should consider lowering your asking price by $10,000.
If you don't lower your asking price, your buyers are unlikely to obtain financing and you will lose this buyer. In fact, you will lose any future buyer who is depending on fully financing your property.

Assuming the buyers have the extra 10K, is it likely the buyers will pay 10K above appraisal? hard to say what is the contracted price? but in general most buyers will not pay a single penny above appraised value